One of the Worst Financial Decisions You Can Make

Here’s one for the 20- and 30-somethings who have been sold a bill of goods about retiring early.

It’s called FIRE: Financial Independence, Retire Early. I have no idea where this came from, but I wish it would go back.

When I first heard about this, I assumed “retire early” meant getting out of the rat race in your 50s, or maybe in your late 40s. But no, this is directed at people who are in their 20s and 30s.

Let’s get right to the point… What in the name of God are you supposed to do for the next 50 or 60 years if you retire in your 30s?

I’m ahead of myself here, but this just sounds so incredibly immature and badly thought out that I kind of lost control for a second.

Let’s skip over the fact that living a life of “carefree bliss” – that’s what one successful FIRE advocate called it – is absurd. I say that because every person I have ever known who left the real world too early – either because of an inheritance or because they built the resources on their own to allow them to do that – went back to work out of self-preservation or looked like hell a few years into their “bliss.”

For the vast majority, it doesn’t work. People need a challenge. They need structure. They need a reason to get up in the morning other than kayaking and rock climbing.

Look at all the research I have quoted in my Two-Minute Retirement Solutions on Tuesdays about how folks fall apart when they step down too suddenly from the working world. Health issues increase, mental health issues pop up, depression and loneliness set in…

This is not a good deal.

But maybe the best reason to run in the other direction from anyone who’s selling this stupidity is an interview with one of the successful FIRE advocates. He and his wife have stepped down from the working world, and they did it on their own.

He described the first year of “bliss” as the most difficult of his life, filled with some big surprises that he didn’t anticipate.

For one, he found that moving is hard. He and his wife sold their big house and downsized. He says he doesn’t feel settled in his new location.

He’s just now figuring out that moving is one of the most difficult things in life to do. It’s up there with losing a loved one, divorce and being fired.

Or how about another surprise in the first year… He wasn’t used to not having someone tell him where to be, when to be there and what to do.

Holy cow, pal – it’s called structure and direction.

He also just now discovered that changes and transitions are hard.

I have news for him… There are many more surprises to come.

If this kind of thinking and lack of maturity is what the FIRE movement considers a success story, I feel really bad for its failures.

Good investing,

Steve